- The New York attorney general’s office has demanded more documents regarding the Tether-Bitfinex deal
- This comes following major revelations about missing funds
- The ongoing investigation does not hinder the activities of either company
A few weeks ago, the news broke that Tether and Bitfinex were under investigation from the New York attorney general’s office over activities the two companies had engaged in. This set off a firestorm of controversy after it was revealed that the two had colluded to cover up hundreds of millions of dollars of losses suffered by Bitfinex by giving them access to Tether’s reserves. As a result of this, it was also revealed that Tether only backed up about 74 percent of their tokens in reserves, which is contrary to their claim that all their tokens were backed up with US dollars.
While they are still feeling the heat of the backlash of the revelations that came out, it has now come out through a memorandum of law filed on May 3, 2019, that the New York State attorney general has requested the disclosure of documents that concerned the deal.
As per the memorandum of law, both companies have been required to be more transparent and it has been claimed that both misled their clients and investors. It is interesting to wonder what else could be revealed as a result of the release of the documents even after the last two revelations. However, it was explained why the documents are being required by the attorney general.
“While that and other discrepancies do not change the core issues in this case […] they only heighten the OAG’s [Office of the Attorney General’s] need to obtain documents and information in a timely, organized fashion so that the OAG may understand what has taken place, and what continues to take place, at these companies.”
Protecting Tether funds
It was also mentioned that another injunction has been crafted by the authorities to keep the status quo and prevent the companies in question from further moving funds that are supposed to be backing up Tether’s tokens while the investigation is ongoing.
It is clear that the attorney general’s office is not looking to rock the boat in regards to Tether’s finances, especially considering the Investor funds that are stake and the fact that Tether is still one of the most important stablecoins on the market. From all indications, the attorney general’s office mainly wants to obtain all the necessary information pertaining to both companies and has also stated that the investigation will not prevent either of them from operating their business as usual.